CMS will establish two new Medicare secondary payer types for set-aside processes when a Medicare beneficiary receives an allocation of funds from a liability settlement or, award that is to be used to pay for a beneficiary’s future medical expenses. CMS will establish a liability insurance Medicare set-aside arrangement (LMSA), and a no-fault insurance Medicare set-aside arrangement (NFMSA). An LMSA or an NFMSA is an allocation of funds from a liability or an auto/no-fault related settlement, judgment, award, or other payment that is used to pay for an individual’s future medical or future prescription drug treatment expenses that would otherwise be reimbursable by Medicare. Medicare does not pay future medical expenses associated with a settlement, judgment, award, or other payment because payment “has been made” for such items or services through use of LMSA or NFMSA funds. Medicare administrative contractors will deny such claims using claim adjustment reason code (CARC) 201 and group code “PR” will be used when denying claims based on the open LMSA or NFMSA MSP auxiliary record.